gross domestic product (GDP) A measure of the value of all goods and services produced by a nation over a specific period, usually a year or quarter. The formula for calculating GDP is Y = C + I + G + (X - M). Y is total production. C is the spending of all consumers in the economy. I is investment by businesses to increase the productive capacity of a nation. G is expenditures by government. (X - M) is the net exports, where X is goods and services exported to other nations, and M is foreign goods and services that are imported.